Brattle Group outlines how utilities should get America to choose electrification

David Roberts, March 2018 says Utilities should be champing at the bit for electrification

An America wherein a substantial portion of transportation, heating, and cooling has been electrified is one with lower carbon emissions, more tools in the utility toolbox, greater demand for electricity, and, crucially, a central role for power utilities.

“Overall,” Brattle writes, “this presents a very positive business outlook and opportunity for utilities: continued growth of sales from centralized (i.e., non-distributed) generation as well as a crucial and likely enhanced role for electricity network infrastructure and controls.”

Here’s the thing, though. Large-scale electrification won’t just happen. It will require policy support from lawmakers. It will require state regulators willing to reenvision the utility business model. It will require organizing and advocacy to overcome fossil fuel resistance.

If utilities want America to choose electrification, they need to get off their asses and help make it happen.

How can they do that? Brattle offers an extensive list, which gets a bit wonky (if you work at a utility, read it!), but here’s the CliffsNotes version:

  1. Make a strategy. Figure out the potential of, and business case for, electrification.
  2. Launch programs. Test things out. Do pilot projects. Figure out what kinds of incentives work.
  3. Plan better. Use credible projections of technology curves and adoption rates.
  4. Use rates. Different kinds of rate design could help incentivize (or slow) electrification.
  5. Talk to regulators. Anything utilities do has to go through state regulators, so they need to be briefed on the benefits of electrification.
  6. Talk to stakeholders. Electrification will require coordination across sectors (e.g., utilities and transportation) that have not typically coordinated; start talking now.
  7. Build infrastructure. EVs will need fast charging stations; utilities can help coordinate and accelerate that.

As far as I am aware, US utilities have no other plan for how to deal with the slow dissolution of their business model (beyond mergers, unnecessary investments, and lobbying for subsidies).

Electrifying everything is a plan. It’s a way for utilities to be climate change champions while boosting demand for their own product.

A few are grasping the opportunity — Southern California Edison, which serves 15 million ratepayers, recently released an ambitious plan to get 7 million EVs on the road and a third of customer heating systems converted to electricity by 2030 — but there is nothing like a unified industry message on the subject. As the realities of the changing energy system sink in, I suspect that will change.